Singapore: Singapore-listed Loyz Energy has announced that it has entered into a binding memorandum of understanding for the acquisition of Canada-listed Primeline Energy Holdings (PEH) for a cost of approximately S$197m ($145.6m).
PEH is an independent oil and gas exploration and production company focusing exclusively on upstream opportunities in China. It owns exploration and development rights in the East China Sea via two petroleum contracts – Block 25/34 and Block 33/07.
“The proposed acquisition will allow the group’s business scale, profits, cashflow from operations and net asset value to increase. This is expected to provide the group with easier access to financing from financial institutions as well as debt and equity capital markets. This will in turn provide the group with balance sheet flexibility to fund future value accretive acquisitions. The proposed acquisition, if completed, will also result in an increase in the company’s market capitalisation, which will potentially widen its investor base and may lead to an overall increase in investors’ interest and trading of the ordinary shares in the company,” said Adrian Lee, managing director of Loyz Energy.